Liberty Interactive, which owns home shopping network QVC, announced on Monday that it would acquire Zulily Inc in a deal valued at $2.4 billion to tap into Zulily’s massive user base and strong mobile presence.
Zulily, which is known for its flash sales of clothing, counts Chinese ecommerce giant Alibaba as one of its shareholders. The big Chinese company held about 9 percent of Zulily’s total common stock. Liberty’s offer of $18.75 per share represents a premium of about 49 percent to Zuliliy’s Friday close. Zulily’s shares rise 49 percent to $18.73 in early trading on Monday.
Zulily’s sales growth has slowed recently, hurt by the growing competition in the market. Liberty plans to leverage Zuliliy’s massive user base and mobile strength, and combine the newly acquired company with its QVC business. Together, the two companies will take an annual revenue of about $10 billion. Once the deal is completed, which is expected in the fourth quarter of this year, Zulily will remain in Seattle and continue to be run by CEO Darrell Cavens.
Based in Seattle, Washington, Zulily is an American ecommerce company that sells clothing, toys, and home products. Launched in 2009 by Blue Nile executives. Zulily’s initial public offering valued the company at a whopping $2.6 billion.
Baker Botts LLP will be Liberty Interactive’s legal adviser. Goldman Sachs will be Zulily’s financial adviser while Gotshal & Manges LLP and Cooley LLP will be its legal adviser.